The Exxon Valdez Oil Spill: Case Study

Discussion

Over time, there have been numerous companies that have been subject to catastrophe and crisis and have not been successful in managing and implementing policies to control the disaster which results in a unquantifiable loss of trust, image and public relations for the companies. One of the major events that can be categorized as being under discussion as such kind of events and adversities is the incident of oil spill occurring almost two decades ago, which continues to remain the largest environmental disasters that took place in the United States. Exxon which is now coming under the brand name of Exxon Mobil was once the world’s largest oil company. It captured 50 percent of the market share and was considered the largest growing oil company in the world. This was until the debacle struck and the company’s crisis management came under extreme criticism and disparagement.

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In 1989, while the Exxon Valdez oil tanker was on its way to California, the ship ran aground on the Prince William Sound and began spilling oil in large quantities. This was a catastrophic event and could only be taken better care of provided action was taken immediately. This was a large crisis for the company and needed instantaneous action and management in order to control, if not cease, the damage that was occurring with the passage of time. It is said that the accident occurred due to the overdose of alcohol consumed by the captain of the ship and other crew members who were responsible for the docking the ship and avoiding it running aground. The event that occurred could be taken care of if there was some instant action implemented to control the leakage and avoid the environmental damage. However, the major factor that aggravated the media and the general public was the way the company handled the situation. (The Exxon Valdez Oil Spill)

The efforts that Exxon took to control the damage were slow, but the reactions and dealings that they had in response to the damage they cause were even slower. There were a number of factors that caused Exxon to create a negative impact on the community and affect their public relations so greatly that it would permanently dent their standing and status among the general public. Time is of the essence in cases of crisis and that is what is considered as the fired error that the company made. It is argued that if the company had taken quick steps, it could have made better attempts at resolving the loss whilst the weather was under control as after days of the oil spill the weather worsened resulting in damage that was almost doubled. Moreover, the chairman of the company made no attempts in visiting the site of accident and taking control which caused uproar in the public blaming the company for being laid back and careless over the incident and showed that the company did not consider the issue important enough to involve the high-level management. it was although, claimed by the chairman that there was nothing he could do personally by going there and it would just waste time. This was one of the major reasons that caused a negative public image as in events of crisis it is important for the company to take initiative and show that they are concerned, alarmed and worried about the damage caused.

Throughout the event, Exxon kept away from the media and the press. This was another cause for the bad public relations that it created. The company did not disseminate any information to the public initially except for in a remote town of Valdez and when it did it was criticized for being contradictory, underestimated and often false information. Moreover, Exxon ignored taking the responsibility for the action and damage caused. It held the federal officials responsible for the hindrance in containing the spill while after 10 days of the incident the company ran an advertisement in the newspapers apologizing for the loss but still not taking any responsibility for it. This act further caused the public to view the company as insincere and artificial. (Holusha, 1989)

These erroneous steps taken by the company caused it to lose its public standing and create a negative impact on its consumers and the public in general. Environmentalists protested against the company and majority of its consumers refused to buy products from the company. The event and its aftermath affected the well-being of the company and caused it an image of being inconsiderate of the environment, irresponsible of its actions and insincere towards the consumers.(Holusha, 1989)

Exxon had always been a low profile company that did not involve a lot in the media and news. Nonetheless, in times of crisis companies are expected to communicate with the public and make them aware of the steps that are being taken in order to resolve the issue. Exxon however, refused to communicate openly and effectively with the media and the public. The media is highly active in matters relating to the environment and the well-being of the surroundings. Hence, it was expected that the media and public would be vigorous towards the issue. It was expected of the chairman or other top management officials to respond to the media in order to show consideration and contemplation towards the damage caused. There was an enormous amount of fine levied upon the company by the law towards corporate responsibility but this loss was not greater than the loss of reputation which was far more important for the company as its image was permanently flawed. This incident caused Exxon to lose its market share and drop down from the largest oil company to the third largest. Also, Exxon was held responsible for causing an economic and emotional damage to the people who generated their living through fishing and were now suffering financial losses. (Hamilton and Hamilton, 1990)

There were a number of actions, if done differently, which could have helped in the way the company was perceived despite the accident. It is not unnatural for accidents and environmental calamities to take place. It was the aftermath and the reaction of the company that caused considerable impact on the public and caused them to become infuriated with the approach of the company towards the situation. Firstly, the interaction with the media and the public relations are extremely important and should be the first steps towards crisis management. Exxon should have carried first-hand news to the public instead of them knowing through other sources and perceive the company as being careless. Moreover, it was the responsibility of the top management personnel to personally hand in effort that may not make a considerable difference in the rehabilitation process but it would at least reflect a compassionate outlook towards the people. Furthermore, Exxon was slow in responding to the incident. During the first two days, while the weather was passive, very little was done to contain the spill causing the spill to spread out even more. After this the weather got worse making the containment very difficult. The company should have had a plan that could inform the actions that needed to be taken when a crisis occurred. This plan could have avoided the impulse actions and would have made the company take more responsible and organized steps in order to resolve the damage. Also, it is important to take immediate actions in considering the reactions of the public and addressing them. This would have been done immediately by the company instead of waiting 10 days to run a newspaper advertisement. (Bryan, 2004)

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A public relations plan outlines all the activities that a company plans on doing in order to fulfill a preset objective. It elaborates on the every aspect of the key elements associated with carrying out the tasks. A public relations plan defines the plan in accordance with the target audience; it chooses the media that is to be used and describes what programs would be taking place in order to either improve the branding and image of the organization or focus on a specific service initiate or a community event. An outline for the public relations plan laid out for Exxon to rejuvenate its reputation and image after the incident would be as follows:

The major market share that Exxon holds is lost and it is now the third-biggest oil company in the world. The reputation of the company is tarnished due to its careless attitude towards the incident of the oil spill and the slow process of containing it has caused the public to be furious. The people that depended upon the Prince Williams Sound for their bread earning such as fishermen have now been unemployed due to the loss of inhabitants in the area. The company needs to rehabilitate its image and come up as a more socially responsible and environmentally concerned organization.

It is important for organizations to communicate with the consumers to maintain a compassionate and empathetic image. The programs that it will be planning now need to be publicized in order for the consumers to know that the company is taking steps in retaining the relationship with its consumers.

What the company is pursuing

There are a number of programs that the company is planning on pursuing. It would run a tour around all the major cities to promote its brand through the new environmentally friendly perspective. Exxon would carry out presentations and press releases on how it would take necessary steps in rehabilitating the marine life throughout the country and how it would make it possible to restore and recuperate the species that were ceased due to the oil spill incident.

The programs would also include giving aid to the fishermen and Native Americans who suffered economically as well as emotionally due to the incident.

The top management including the chairman would make press tours around different cities and around the affected areas of Alaska and make arrangements for making a difference to the people and helping them renew their view towards the company.

The company would also make customer testimonials which would be aimed at showing the customers that they are important. The company would aim on releasing statements over the event and would take the responsibility for the mishap and the lack of coordination and management of the incident. It would assure through the plan that it would carry out a more environmentally active role.

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Conclusion

In the end it is important to understand that disasters and accidents are inevitable and unexpected but it is the actions taken after the incident that is of significance. A company that manages crises well is one that is respected and pursued by the consumers and the general public. In order to manage crises well and take the right steps in times of disasters is well taken care of through a plan that would be an advance preparation for the course of action to be implemented. With the world contracting and with the advent of globalization, news spreads quickly and companies need to take care of the way they are perceived by the consumers. Moreover, it is equally important to make the right decisions in time of accidents in order to avoid bad publicity and a permanent dent in the company’s image and reputation.

Bibliography

Bryan, N (2004). Exxon Valdez oil spill. World Almanac Library.

Carr, T (1991). Spill!: the story of the Exxon Valdez.

Hamilton, S.L., & Hamilton, J. (1990). The Exxon Valdez.ABDO Publishing Company.

Holusha, J (1989). Exxon’s public-relations problem. The New York times , Web.

The Exxon Valdez Oil Spill. (n.d.). 2009. Web.

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